Starting a Business in Holland
Holland Business Experts
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Why Start A Business In Holland?
With great liberalism comes great responsibility. The Dutch are liberal all right. But don't be mistaken, they take the reputation very seriously. As the rest of Europe sinks into legislative hell and civil assault, Holland maintains its adherence to the cause: the fundaments of freedom. The Dutch put their liberality into museums, onto stages and into cafes. It even spills out onto the streets, with their red lights, late nights and fishnet tights.
But that's the Netherlands that the Netherlands doesn't want to talk about. And rightly so. There is far more to the country than meets the stereotypical eye, and focusing on the reasons you went there when you were 18 is probably not the best approach. Adopt the Dutch mentality; take things in your stride, and business is no exception to the rule.
Like its liberal outlook on life, Holland's economy is an open, prosperous proposition, and, as with most things in the egalitarian model, everything is up for discussion. After a few comparatively lean years at the turn of the century, the turnaround in economic fortuity has been remarkable, and although initial recovery was a consequence of rising export growth, there are now signs that consumer spending and investment have become significant accelerators too.
Barriers for market entry are unsurprisingly low, and legalities are equally unequivocal. This coupled with a sophisticated financial model makes Holland a optimum country to set-up or relocate. It's a veritable EU-topia for foreign investment. The Netherlands punches above its weight in world business and politics. It has a thriving service sector and vaunts impeccable industries like science, electronics, food, flowers, the chemical industry, water technology, and engineering. It also provides local and alien businesses with a welcome environment, and accommodates international trade, efficient export, innovation, and synergy with some of the world's top corporations and research establishments.
Entry options are vast. As vast as the liberal eye can see, actually. And although the Dutch are resigned to the cold shoulder of high taxes, other facets of the fiscal system are hotter than a Red Light District window. The Dutch government have been cutting, exempting and reducing like they're having a January sale, and for small and medium sized companies, in particular, this means immeasurable opportunity. Coupled with the Netherlands flattering Anglophilia and their aptitude for Anglophonics, the advantages of establishing there are overwhelmingly in your favour.
What is the population?
The population of the Netherlands is approximately 16.81 million.
What is the currency and exchange rate?
The currency used in the Netherlands is the Euro.
What is the climate like?
Amsterdam has a mild, damp climate. However, the weather can be variable with temperature extremes even in summer. Spring and autumn, in particular, bring changeable, unsettled weather. In the winter months, clear, frosty days are not uncommon, with the coldest months being December to March. Rain is inevitable all year round.
What is the time difference?
The time in the Netherlands is GMT + 1.
What languages are spoken?
Dutch the official language, is spoken by around 90% of the population.
It is also an Anglophone nation. English is taught in schools and is widely spoken.
Approximately 2% of the population speak Frisian as their first language, mainly in the northern province of Friesland, where it is acknowledged as an official language. Turkish and Arabic are also spoken in the Netherlands.
The Netherlands has convalesced from its economic slump at the turn of the century, and is currently in good shape for people wanting to set up a business. continued to be attracted by its amicable business environment. The pace of veritable GDP progress has toughened, unemployment has recouped, and the fiscal position has been rebalanced.
Industrial operations are overtly in food processing, chemicals, petroleum refining, and electrical machinery. A reliable agricultural sector employs approximately than 3% of the workforce and offers large surpluses for the food-processing industry and for exports.
Holland's economy has a keen international eye, and is one of the European Union's most vigorous hubs of trade and industry. In debt largely to its strategic location by the North Sea, it plays a vital role as a main port and distribution centre for worldwide business activity. The port of Rotterdam is annually responsible for over 350 million tonnes of goods, and is one of the largest ports in the world. Amsterdam's Schiphol Airport, on the other hand, is one of the biggest airports in Europe. And it is for these reasons that Holland is frequently alluded to as the Gateway to Europe.
Holland's position in global competitiveness has come from strength-to-strength, positing it in the global top-ten.
What are the essentials to know?
Many investors delegate commercial agents to assist with their accession to the Dutch market. If you are setting up a business in the Netherlands, it is recommended that you have written contracts with agents.
An alien company can establish their business in Holland without needing to form a local subsidiary. A local subsidiary is a branch-company; essentially an extension of the foreign, parent company. The foreign parent company is responsible for its liabilities.
During the late 1980s, Dutch law was altered to welcome the EU agency law. Pieces of this new law had already been part of Dutch national law for many years anyway. The law calls for agents to act in good faith. Commission must be duly paid and at least three months' notice should be given in the case of termination.
It is recommended that agreements with agents and/or distributors in the Netherlands be outlined in writing with specific terms agreed upon. It is also recommended that businesses seek legal advice before advancing with any agreement. Withdrawing from an agreement can be arduous and expensive if a representative proves unsatisfactory.
Labour and workforce
The Netherlands has one of the lowest unemployment rates in the EU, about 6% of the working population. This is predicted to decrease further over the next year or so to around 5%. There is a lack of professionals in some areas, like teaching and healthcare.
Holland has a well educated, multi-lingual population. It is an Anglophonic nation. Businesses wanting to establish there will benefit from the unequalled dexterity of language. Sales, secretarial and administration staff are invariably qualified with at least one other language with them. Obviously, this comes without the additional costs that such qualification would warrant in the United Kingdom.
Salaries are relatively high. The Dutch workforce is covered by a social security program, the expense of which is spread between employers, employees and government.
Labour legislation is rather convoluted and generally favours employees. It is recommended that legal advice is sought before advancing with any contracts; especially if you are uncertain of the implications.
Contracts of employment
The agreement between employer and employee is overseen by an official contract, invariably made in writing. There are two types of contracts: individual contracts and collective contracts. Both contracts will outline the agreements on salary, working conditions, probation periods, and termination procedures.
There are regulations on minimum wages for young employees. Part-time and short-period work contracts are permitted.
As elsewhere in the EU, discrimination on grounds of sex, race, nationality and religion is not tolerated.
If you employ more than fifty people, a workers' council must be established. This board is entitled to an involvement in the general aspects of the business; namely things immediate to workers - conditions, mergers, investments, etc.
Additional to salaries or wages, employees are entitled to:
- Holiday payment of at least 8% annual salary
- Holidays (minimum 20 days a year)
- Social security, providing for sickness, disability and unemployment payments
- Pension plans
The monthly minimum wage is 1,594 Euros.
Are there any official agencies that can help me?
The Foreign Investment Agency (NFIA) is a Dutch government board tasked specifically with helping foreign investors establish in the country. It is located London. It is recommended you contact them at the earliest opportunity.
The NFIA is responsible for foreign investment, and has regional and local development organisations in Holland. It offers businesses a scope of fundamental economic, financial, statistical and technical information. This will help decide which area of the country, if any, is suitable to you. It has a computerised database of all relevant industrial sites, and will indeed organise trips to selected sites. Its services are confidential and at no cost to you.
The Chamber of Commerce can also prove beneficial. Most companies, with the exception of some small ones, must enrol with the Chamber of Commerce. The specifics required are name, address, place of establishment, business activities, legal form (public or private company) and management (members of the board of management, authorised representatives).
You'll be expected to be punctual and organised for meeting. Schedule appointments two weeks in advance if you're not far away, a month in advance if you are. Call within a few days to make sure all meetings are still proceeding. July and August are summer months in the Netherlands, so try and avoid these months for scheduling appointments if you can.
Business dress is usually dark and conservative with white shirts or blouses. Avoid colourful, busy ties or scarves.
Business cards and other materials can be printed in English and needn't be translated into Dutch on the reverse.
Privacy is, unlike for instance in the middle east, of utmost importance in the work. All doors are kept shut. Knock first and wait for a response. Conversely, remember to always close doors when you leave. Don't talk or gossip about other associates - it is frowned upon.
At the end of a business meeting shake hands with each person individually.
Organisations that can assist with Starting a Business
Simplified Global Payroll Managing payroll in multiple countries is complicated with different systems, deadlines, and languages in each country, lack of reporting, and constantly changing laws and regulations. Trying to manage global payroll via fax and email with excel spreadsheets leads to data security issues, fines, and penalties for non-compliance. Blue Marble has solved global payroll challenges with cloud-based technology, customized aggregated monthly reporting, and a hybrid service model in 150+ countries around the world.
PEO Worldwide is an international PEO offering employer of record, payroll, employee benefits management, HR and compliance services throughout the world.
MFFA Tax Advice is a Dutch based tax and accounting boutique (one stop shop) with offices in Amsterdam, Amstelveen and Eindhoven. We provide forward-thinking and tailored Dutch tax advice for individuals and foreign companies operating cross border.
GTP cross cultural trainings and intercultural workshops help global companies in improving their communication, efficiency and profitability when doing business across cultures.
More Group is an international accounting firm specialising in tax accounting, business incorporation, and trustee services. Contact us today to book your free initial consultation.